US GDP growth came in at 1.5% in the second quarter of 2026, a significant decline from 2.1% in the first quarter and well below the 2.1% economists had forecast. This slowdown represents one of the sharpest contractions in several quarters, with the trade deficit explaining much of the weakness as imports of electronic chips for AI weighed heavily on the balance. Despite record investments in data centers and AI infrastructure, no significant productivity gains have emerged at the macroeconomic level, with three consecutive quarters of weak productivity growth. Household consumption remains solid, driven by vehicles, furniture, and prescription drugs, but insufficient to offset the trade imbalances.
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